Whidbey Island Real Estate Information

As we approach the end of 2011, we start to evaluate the statistics for the year. Since we are still in December, the final results won’t be available to be posted for a few weeks, but I thought I would give you a taste of the real estate market here on beautiful Whidbey Island. I will show you a snapshot of total sales and median prices for the three areas of Whidbey Island; North, Middle, and South. In my next post I will include graphs and explanations for the total 2011 sales.

North Whidbey Island, which includes every sale north of Libbey Rd, was down both in total transactions and median sales price. Sales were down approximately 6% from 2010 and the median sales prices was down approximately 5%.

Central Whidbey Island saw a year where the sales increased approximately 6% but the median sales price remained about the same as 2010.

South Whidbey Island experienced an increase in sales of approximately 1.5% but declined in median sales price of close to 13%.

As we have always been told, real estate is very local. These few statistics only give a snapshot of the overall market in these areas. Individual homes and locations can vary by quite a large differential. Your local real estate specialist can help you with your particular property’s value and ability to be sold. I will be posting a much more in-depth market report in a few weeks.

The sale of your home is stressful enough without adding the stress on a home inspection. In this interview with Rick Bunzel of Pacific Crest Inspections and Rick Schutte of Coldwell Banker Koetje Real Estate, we discuss how to make the home inspection process less stressful. Rick gives us 5 ideas that benefit the home seller, buyer, and home inspector and helps to relieve some of the stress of the home inspection.

If the house is more than 3 years old, get the furnace serviced and provide the inspector the receipts.

Paint and touch up any peeling paint areas.

If you have an older roof, have a roofer check it and make any repairs. Provide the receipts to the inspector.

If something is broken, get it fixed before the inspection. If you can’t get it fixed, disclose it to the inspector.

Make sure everything is accessible.

Consider having a pre-listing inspection. Spending a little bit of money upfront can yield big savings during the negotiations.

One of the comments that I hear quite often is “I don’t have 20% down and so I can’t buy a house”. Many people are confused and have the wrong information when it comes to purchasing a home. News articles, tv programs, etc. talk about how hard it is to get financing, to get qualified, the amount of down payment needed, etc.

In today’s lending environment, your credit rating is one of the most important things to consider. You credit rating can affect your interest rate, your ability to qualify for the loan, and many other factors. I posted an interview with a local lender that answered Home Mortgage Questions that is very informative.

Back to the down payment question. Do you need 20% down to buy a home. The answer to that question is NO. There are loan programs available today with a minimum zero down payment if you qualify. There are FHA programs available with 3%-5% down payment available. There are conventional mortgage programs available with very minimal down payments required. There are some great loan advisers here on Whidbey Island. I would encourage any one that is considering a home purchase to sit down with one of these local advisers and get your questions answered. It is very possible that today may be the day that you decide that it is time to own your own home.

Whidbey Island Home Inspector, Rick Bunzel, of Pacific Crest Inspections, discusses with Rick Schutte of Coldwell Banker Koetje Real Estate, some up-to-date tips for preventing fires and making sure your smoke detector is current. He discusses the different types of smoke detectors, what to do if your smoke detector is over 10 years old, and the different kinds of batteries for your smoke detector. Besides being a Whidbey Island Home Inspector, Mr. Bunzel is also a volunteer fire fighter.

Besides being a Whidbey Island Home Inspector, Rick Bunzel is the Principle Inspector at Pacific Crest Inspections. If you would like to know more about your home go to WWW.Paccrestinspections.com

Recently, Rick Schutte the owner/designated broker of Coldwell Banker Koetje Real Estate interviewed Lyn Bankowski, senior loan originator with AlaskaUSA Mortgage. They discussed numerous items of interest such as how the financial markets are affecting interest rates, and how the rates are so low today for purchasing and for refinancing. They also discussed how much mis-information is out there today about the lack of financing. Lyn said that loans are still available to credit worthy borrowers but the amount of paperwork has increased. Finally, there is some discussion about the benefits of VA loans and the ability to borrow up to $6000 for energy efficiency as well as the benefit of VA loans being assumable.

Home prices are down, interest rates are down, and rental properties are becoming scarce.

I see homes everyday that are great investment values, that I would buy myself if I could.

15 year fixed interest rates are at the lowest they have ever been! The fixed rate for 15
year mortgages is as low as 3.35%. Other home mortgage rates are at historic lows as well.

Prices for single family homes are well below peak levels in most Whidbey Island neighborhoods, and many condominiums are priced the lowest they have been in ten years!

Home affordability in the first quarter of 2011 was at the best level in the 20 years it has been calculated, and remains close to that record level for the latest quarter.

Stock market volatility demonstrates that stocks are not the safest place to put all your savings. A diversified investment strategy that includes long term investment in real estate should be part of your financial strategy

FOUR QUESTIONS TO CONSIDER WHEN DECIDING WHETHER TO BUY OR RENT A HOME

“To buy or to rent?” Recent graduates, young couples, relocating professionals and others have all asked themselves this question at one point or another. While each option has its benefits, the decision to purchase an apartment, condominium or house as opposed to renting, is complex and based on a number of factors. According to a recent survey from the National Association of Realtors, nearly eight out of 10 respondents believe buying a home today is a good financial decision. The question that remains is whether or not now is the right time to buy a home for you.

For most people, deciding to buy a home is the largest financial decision of their lifetime. Before making the jump into homeownership, potential home buyers should consider the “soft” lifestyle issues as well as the “hard” financial ones. The professionals at Coldwell Banker Real Estate LLC have provided the following four financial and lifestyle questions to consider when determining if buying a home is the right decision for you:

1. Do you have a steady income? At or near the top of every potential homebuyer’s mind is whether or not they can afford to buy a home right now. Buying a home remains a sound financial decision for those with documented income and a good credit history, and a steady income can provide a strong backbone for the initial down payment and future mortgage payments. Buy-versus-rent calculators available on websites such as coldwellbanker.com offer a good start, but there are numerous factors beyond straight economics that also need to be considered. Don’t hesitate to speak with a real estate professional even before you’re ready to buy a home. Along with a financial planner, a Coldwell Banker Koetje real estate professional can help you answer and uncover questions about the cost of homeownership.

Do you plan to stay in a home for an extended period of time? With proper planning, a home purchase has historically proven to be one of the safest investments one can make. Along those lines, it’s imperative to understand that investing in a home is much different than investing in a stock portfolio. Homes typically appreciate in value over time while the owner builds his or her equity through monthly mortgage payments. If you anticipate staying in a home for only one or two years, it doesn’t necessarily mean buying is not for you, but you are less likely to see a significant financial return on your investment.

Do you plan to sell a house in order to buy a house? A local real estate professional can help you understand current local market conditions and will help you make smart decisions when listing a home on the market. If you do not currently own a home that needs to be sold prior to purchasing a new one, now is a particularly smart time to buy. Even with lenders becoming increasingly more thorough in their approval process, mortgage financing is still widely available for those with a steady income and solid credit. High inventories and low interest rates give first-time homebuyers a tremendous amount of opportunity and flexibility in markets across the U.S.

How do your other options compare? For renters, calculating month-to-month housing expenses is as easy as inquiring about the monthly rent and average utilities. The calculation gets a bit more complicated when considering the monthly cost of owning a home. A real estate professional can help you understand a range of financial considerations from annual property taxes to the tax incentives for owning a home.

In today’s real estate environment, buyer’s representation is an important aspect of your real estate transaction. A buyer’s agent is always representing your best interest and is obligated to inform you of options you may have that will impact your purchase. The buyer’s agent has been trained in negotiations and local market conditions to help you get the best buy possible.

If you are a senior, there are buyer’s agents that have been trained and certified to work specifically with seniors and to understand some of the unique challenges that are created due to down-sizing, financing, etc. These agents have the Senior Residential Specialist Designation issued by the National Association of Realtors. If you are a senior, I would recommend asking for a buyer’s agent with this designation.

Do you need a buyer’s agent to purchase a home? Not necessarily, but in all honesty, it is one of the best things a home buyer can do to ensure a smooth transaction, best buy possible, and at the end of the day, peace of mind.

Seven in 10 Americans also agreed that buying a home is a good financial decision while almost two-thirds said now is a good time to purchase a home. The annual survey, which measures how affordable housing issues affect consumers, also found that more than three quarters of renters (77 percent) said they would be less likely to buy a home if they were required to put down a 20 percent down payment on the home, and a strong majority (71 percent) believe a 20 percent down payment requirement could have a negative impact on the housing market.

“Despite the economic setbacks Americans have experienced in today’s current climate, it is clear that a strong majority still believe in home ownership and aspire to own a home,” said NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I. “However, achieving the dream of home ownership will become increasingly difficult for buyers if they are required to make a 20 percent down payment, which may be a reality for many of tomorrow’s buyers if a proposed Qualified Residential Mortgage rule is adopted. That is why Realtors® are strongly urging regulators to go back to the drawing board on the proposed rule.”

Defining the QRM rule is important because it will determine the types of mortgages that will generally be available to borrowers in the future. As currently proposed, borrowers with less than 20 percent down will have to choose between higher fees and rates today — up to 3 percentage points more — or a 9-14 year delay while they save up the necessary down payment.

Over half — 51 percent — of self-described “working class” home owners as well as younger non-college graduates (51 percent), African Americans (57 percent) and Hispanics (50 percent) who currently own their homes reported that a 20 percent down payment would have prevented them from becoming home owners.

Pulse surveys for the past eight years have consistently reported that having enough money for a down payment and closing costs are top obstacles that make housing unaffordable for Americans. Eighty-two percent of respondents cited these as the top obstacle, followed by having confidence in one’s job security.

The survey also found respondents were adamantly against eliminating the mortgage interest deduction. Two-thirds of Americans oppose eliminating the tax benefit, while 73 percent believe eliminating the MID will have a negative impact on the housing market as well as the overall economy.

“The MID facilitates home ownership by reducing the carrying costs of owning a home, and it makes a real difference to hard-working American families,” said Phipps. “Home ownership offers not only social benefits, but also long-term value for families, communities and the nation’s economy. We need to make sure that any changes to current programs or incentives don’t jeopardize our collective futures.”

When asked why home ownership matters to them, respondents cited stability and safety as the top reason. Long-term economic reasons such as building equity followed closely behind. On a local level, respondents said neighbors falling behind on their mortgages and the drop in home values were top concerns. Foreclosures also continue to remain a large concern, with almost half of those surveyed citing the issue as a problem in their area.

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About Rick Schutte

Rick is the owner/designated broker of Coldwell Banker Koetje Real Estate and Koetje Property Management. He has been involved with the real estate industry on Whidbey Island for over 32 years. He is a past president of the NWMLS as well as a current board member of the North Puget Sound Association of Realtors. He has been designated by the National Association of Realtors as a Certified Real Estate Brokerage Manager as well as a Graduate of the Real Estate Institute. Rick can be reached at 360-675-5811 or cbk@WhidbeyRealEstate.com
You can also check out his website at http://www.cbkoetje.com

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